Belgium's increasing trade dependency on China requires greater vigilance, warned the National Bank of Belgium (NBB) in a press release on Thursday.
The NBB highlighted concerns over Europe's excessive dependence on China as the primary supplier of strategic goods, including those crucial for national security, health, energy, and the transition to greener and digital procedures. It attributes the rise in imports to Chinese overproduction and its aggressive industrial policies.
While Belgium’s direct exposure to Chinese imports and exports is small compared to the EU, its composition has changed in recent years. The focus has shifted from textiles and toys to more advanced goods like electronics and electric vehicles. The bank also notes a growing proportion of chemical products in Belgium’s exports to China.
Moreover, Belgium relies heavily on China for around 50 of its 200 identified strategic import products, according to the NBB. These range from vitamins and industrial chemical raw materials to steel bars, LED lights, and permanent magnets. Industries such as textile manufacturing, electronics, and basic metals are also indirectly exposed to China through international supply chains.
The NBB further emphasises the need to monitor how the EU manages its trade relationship with China, as Belgian policymakers and firms will increasingly experience the consequences of these changes. This includes "punitive import tariffs and (possibly) export controls, more burdensome investment screening procedures and reporting duties to spillovers from EU-level and Member State industrial policies," the NBB concludes.
